SUB-INVESTMENT ADVISORY AGREEMENT
BETWEEN ASTON ASSET MANAGEMENT, LLC
AND LAKE PARTNERS, INC.
SUB-INVESTMENT ADVISORY AGREEMENT (the "Agreement") made
this 30th day of May, 2014 by and between ASTON ASSET
MANAGEMENT, LLC (hereinafter referred to as the "Investment
Adviser") and LAKE PARTNERS, INC. (hereinafter referred to as
the "Subadviser"), which Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute but one
instrument.
W I T N E S S E T H:
WHEREAS, the Investment Adviser has been retained by Aston
Funds, a Delaware statutory trust (the "Trust"), a registered
management investment company under the Investment Company Act
of 1940, as amended (the "1940 Act") to provide investment
advisory services to the Trust with respect to certain series of
the Trust set forth in Schedule A hereto as may be amended from
time to time (hereinafter referred to as a "Fund" and
collectively, the "Funds" of the Trust);
WHEREAS, the Investment Adviser wishes to enter into a
contract with the Subadviser to provide research, analysis,
advice and recommendations with respect to the purchase and sale
of securities, and make investment commitments with respect to
such portion of the Funds' assets as shall be allocated to the
Subadviser by the Investment Adviser from time to time (the
"Allocated Assets"), subject to oversight by the Trustees of the
Trust and the supervision of the Investment Adviser.
NOW THEREFORE, in consideration of the mutual agreements
herein contained, and intending to be bound, the parties agree
as follows:
1. In accordance with the Investment Advisory Agreement
between the Trust and the Investment Adviser ("Investment
Advisory Agreement") with respect to the Funds, the Investment
Adviser hereby appoints the Subadviser to act as subadviser with
respect to the Allocated Assets for the period and on the terms
set forth in this Agreement. The Subadviser accepts such
appointment and agrees to render the services set forth herein,
for the compensation provided herein.
2. As compensation for the services enumerated herein,
the Investment Adviser will pay the Subadviser a fee with
respect to the Allocated Assets, which shall be calculated and
payable monthly in arrears within ten (10) business days after
the end of each month based on the average daily net assets of
the Fund, in an amount equal to 50% of the positive difference,
if any, of (x) the advisory fee payable to the Investment
Adviser with respect to the Allocated Assets of the Fund (before
deduction of the fee payable to Subadviser) minus (y) the sum
of: (i) any investment advisory fees waived by the Investment
Adviser pursuant to an expense limitation or reimbursement
agreement with the Fund, (ii) any reimbursement of Fund expenses
by the Investment Adviser pursuant to an expense limitation or
reimbursement agreement with the Fund, and (iii) any payments
made by the Investment Adviser to third parties that provide
distribution, shareholder services or similar services on behalf
of the Fund. If the foregoing calculation results in a negative
amount, such amount shall be payable by the Subadviser to the
Investment Adviser within 30 days of receipt of notice from the
Investment Adviser, which notice shall include the basis for the
calculation.
For the purposes of this Agreement, a Fund's "net assets"
shall be determined as provided in the Fund's then-current
Prospectus (as used herein this term includes the related
Statement of Additional Information).
If this Agreement shall become effective subsequent to the
first day of a month, or shall terminate before the last day of
a month, the Subadviser's compensation or the amount payable by
the Subadviser to the Investment Adviser (in the event the
calculation of the Subadviser's compensation results in a
negative amount) for such fraction of the month shall be
prorated based on the number of calendar days of such month
during which the Agreement is effective.
3. This Agreement shall become effective with respect to
a Fund as of the date set forth opposite the Fund's name as set
forth on Schedule A hereto (the "Effective Date"), provided that
it has been approved by the Trustees of the Trust in accordance
with the provisions of the 1940 Act and the rules thereunder
and, if so required by the 1940 Act and the rules thereunder, by
the shareholders of the Fund in accordance with the requirements
of the 1940 Act and the rules thereunder.
4. This Agreement shall continue in effect for the
initial term set forth in Schedule A. It shall be renewed
automatically thereafter with respect to a Fund by the
Investment Adviser and the Subadviser for successive periods not
exceeding one year, if and only if such renewal and continuance
is specifically approved at least annually by the Board of
Trustees of the Trust or by a vote of the majority of the
outstanding voting securities of the Fund as prescribed by the
1940 Act and provided further that such continuance is approved
at least annually thereafter by a vote of a majority of the
Trust's Trustees, who are not parties to such Agreement or
interested persons of such a party, cast in person at a meeting
called for the purpose of voting on such approval. This
Agreement will terminate with respect to a Fund without the
payment of any penalty upon termination of the Investment
Advisory Agreement relating to a Fund by either party thereto
(accompanied by simultaneous notice to the Subadviser) or upon
sixty days' written notice to the Subadviser that the Trustees
of the Trust, the Investment Adviser or the shareholders by vote
of a majority of the outstanding voting securities of the Fund,
as provided by the 1940 Act, have terminated this Agreement.
This Agreement may also be terminated by the Subadviser with
respect to a Fund without penalty upon sixty days' written
notice to the Investment Adviser and the Trust.
This Agreement shall terminate automatically with respect
to a Fund in the event of its assignment by the Subadviser or,
upon notice thereof to the Subadviser, the assignment of the
Investment Advisory Agreement, unless its continuation
thereafter is approved by the Board of Trustees of the Trust and
the shareholders of the Fund if so required by the 1940 Act (in
each case as the term "assignment" is defined in Section 2(a)(4)
of the 1940 Act, subject to such exemptions as may be granted by
the Securities and Exchange Commission ("SEC") by any rule,
regulation, order or interpretive guidance).
5. In performing its services under this Agreement, the
Investment Adviser shall comply in all material respects with
the requirements of the 1940 Act, the Investment Advisers Act of
1940 and the rules thereunder (the "Advisers Act"), and all
other applicable federal and state laws and regulations, and
shall act in conformity with the Trust's Declaration of Trust,
By-Laws and currently effective registration statements under
the 1940 Act and the Securities Act of 1933 and any amendments
or supplements thereto (the "Registration Statements") and with
the written policies, procedures and guidelines of each Fund,
and written instructions and directions of the Trustees of the
Trust.
6. Subject to the oversight of the Board of Trustees of
the Trust and the Investment Adviser, the Subadviser will
provide an investment program for the Allocated Assets,
including investment research and management with respect to
securities and investments, including cash and cash equivalents,
and will determine from time to time what securities and other
investments will be purchased, retained or sold. The Subadviser
will provide the services under this Agreement in accordance
with each Fund's investment objective, policies and restrictions
as stated in the Prospectus, as provided to the Subadviser by
the Investment Adviser. The Subadviser further agrees that, in
all matters relating to the performance of this Agreement, it:
(a) shall act in conformity with the Trust's
Declaration of Trust, By-Laws and Registration Statements and
with the written policies, procedures and guidelines of each
Fund, and written instructions and directions of the Trustees of
the Trust and shall comply with the requirements of the 1940
Act, the Advisers Act, and all other applicable federal and
state laws and regulations. The Investment Adviser agrees to
provide Subadviser with copies of the Trust's Declaration of
Trust, By-Laws, Registration Statements, written policies,
procedures and guidelines, and written instructions and
directions of the Trustees, and any amendments or supplements to
any of them at, or, if practicable, before the time such
materials, instructions or directives become effective;
(b) will pay expenses incurred by it in connection
with its activities under this Agreement other than the cost of
securities and other investments (including brokerage
commissions and other transaction changes, if any) purchased for
each Fund, provided that the Subadviser will not pay for or
provide a credit with respect to any research provided to it in
accordance with Section 6(c);
(c) will place orders pursuant to its investment
determinations for the Allocated Assets either directly with any
broker or dealer, or with the issuer. In placing orders with
brokers or dealers, the Subadviser will attempt to obtain the
best overall price and the most favorable execution of its
orders. Subject to written policies established by the Trustees
of the Trust and communicated to the Subadviser, it is
understood that the Subadviser will not be deemed to have acted
unlawfully, or to have breached a fiduciary duty to the Trust or
in respect of a Fund, or be in breach of any obligation owing to
the Investment Adviser or the Trust or in respect of a Fund
under this Agreement, or otherwise, solely by reason of its
having caused the Fund to pay a member of a securities exchange,
a broker or a dealer a commission for effecting a securities
transaction for the Fund in excess of the amount of commission
another member of an exchange, broker or dealer would have
charged if the Subadviser determines in good faith that the
commission paid was reasonable in relation to the brokerage or
research services (as those terms are defined in Section 28(e)
of the Securities Exchange Act of 1934 and interpretive guidance
issued by the SEC thereunder) provided by such member, broker or
dealer, viewed in terms of that particular transaction or the
Subadviser's overall responsibilities with respect to the
accounts, including the Fund, as to which it exercises
investment discretion;
(d) will review the daily valuation of securities
comprising the Allocated Assets of each Fund as obtained on a
daily basis by the Fund's administrator and furnished by it to
Subadviser, and will promptly notify the Trust and the
Investment Adviser if the Subadviser believes that any such
valuations may not properly reflect the market value of any
securities owned by the Fund, provided, however, that the
Subadviser is not required by this sub-paragraph to obtain
valuations of any such securities from brokers or dealers or
otherwise, or to otherwise independently verify valuations of
any such securities;
(e) unless otherwise instructed by the Investment
Adviser, will be responsible for voting all proxies of the
Allocated Assets in accordance with the Proxy Voting Policies
and Guidelines of Subadviser (the "Proxy Policy"), provided that
such Proxy Policy and any amendments thereto are furnished to
the Trust;
(f) will attend regular business and investment-
related meetings with the Trust's Board of Trustees and the
Investment Adviser if requested to do so by the Trust and/or the
Investment Adviser, and at its expense, shall supply the Board,
the officers of the Trust, and the Investment Adviser with all
information and reports reasonably required by them and
reasonably available to the Subadviser relating to the services
provided by the Subadviser hereunder;
(g) will maintain books and records with respect to
the securities transactions for the Allocated Assets of each
Fund and proxy voting records for the Allocated Assets of the
Fund, furnish to the Investment Adviser and the Trust's Board of
Trustees such periodic and special reports as they may
reasonably request with respect to the Fund, and provide in
advance to the Investment Adviser all of the Subadviser's
reports to the Trust's Board of Trustees for examination and
review within a reasonable time prior to the Trust's Board
meetings; and
(h) will pay expenses incurred by the Trust for any
matters related to any transaction or event that is deemed under
the 1940 Act to result in a change of control of the Subadviser.
7. The Investment Adviser or its affiliates may, from
time to time, engage other subadvisers to advise other series of
the Trust (or portions thereof) or other registered investment
companies (or series or portions thereof) that may be deemed to
be under common control (each a "Sub-Advised Fund"). The
Subadviser agrees that it will not consult with any other
subadviser engaged by the Investment Adviser or its affiliates
with respect to transactions in securities or other assets
concerning a Fund or another Sub-Advised Fund, except to the
extent permitted by the rules under the 1940 Act that permit
certain transactions with a subadviser or its affiliates.
8. Subadviser agrees with respect to the services
provided to each Fund that it:
(a) will promptly communicate to the Investment
Adviser such information relating to Fund transactions as the
officers and Trustees of the Trust may reasonably request and as
communicated to the Subadviser; and
(b) will treat confidentially and as proprietary
information of the Trust all records and other information
relative to each Fund and its prior, present or potential
shareholders, and will not use such records and information
(collectively, "Confidential Information") for any purpose other
than performance of its responsibilities and duties hereunder
(except after prior notification to and approval in writing by
the Trust, which approval may not be withheld where Subadviser
is advised by counsel that the Subadviser may be exposed to
civil or criminal contempt or other proceedings for failure to
comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Trust).
The term Confidential Information shall not include
information that (a) is or becomes publicly available without
violation of this Agreement, including the track record of each
Fund, (b) is or becomes lawfully available from a third party,
or (c) is approved for disclosure by written authorization of
the Trust. The names of clients or potential clients of the
Subadviser are not proprietary information of the Trust, but the
Subadviser shall treat an investment in the Fund by such clients
or potential clients of the Subadviser as confidential;
provided, however, all shareholder account information of such
persons who become investors in the Fund is subject to the
privacy policies of the Trust.
9. In compliance with the requirements of Rule 31a-3
under the 1940 Act, Subadviser acknowledges that all records
that it maintains for the Trust are the property of the Trust
and agrees to surrender promptly to the Trust any of such
records upon the Trust's request, provided, that Subadviser may
retain copies thereof at its own expense. Subadviser further
agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act the records required to be maintained by Rule
31a-1 under the 1940 Act relating to transactions placed by
Subadviser for the Fund. Subadviser further agrees to maintain
each Fund's proxy voting record with respect to the Allocated
Assets in a form mutually agreeable between the parties and
which contains the information required by Form N-PX under the
1940 Act.
10. It is expressly understood and agreed that the
services to be rendered by the Subadviser to the Investment
Adviser under the provisions of this Agreement are not to be
deemed to be exclusive, and the Subadviser shall be free to
provide similar or different services to others so long as its
ability to provide the services provided for in this Agreement
shall not be materially impaired thereby. Nothing in this
Agreement shall limit or restrict the right of any director,
officer, or employee of the Subadviser to engage in any other
business or to devote his or her time and attention in part to
the management or other aspects of any other business, whether
of a similar nature or a dissimilar nature.
11. The Investment Adviser agrees that it will furnish
currently to the Subadviser all information with reference to
each Fund and the Trust that is reasonably necessary to permit
the Subadviser to carry out its responsibilities under this
Agreement, and the parties agree that they will from time to
time consult and make appropriate arrangements as to specific
information that is required under this paragraph and the
frequency and manner with which it shall be supplied. Without
limiting the generality of the foregoing, Investment Adviser
will furnish to Subadviser procedures consistent with the
Trust's contract with each Fund's custodian from time to time
(the "Custodian"), and reasonably satisfactory to Subadviser,
for consummation of portfolio transactions for each Fund by
payment to or delivery by the Custodian of all cash and/or
securities or other investments due to or from the Fund, and
Subadviser shall not have possession or custody thereof or any
responsibility or liability with respect to such custody. Upon
giving proper instructions to the Custodian, Subadviser shall
have no responsibility or liability with respect to custodial
arrangements or the acts, omissions or other conduct of the
Custodian.
12. The Subadviser agrees to indemnify and hold harmless
the Investment Adviser, any affiliated person within the meaning
of Section 2(a)(3) of the 1940 Act ("affiliated person") of the
Investment Adviser and each person, if any, who, within the
meaning of Section 15 of the Securities Act of 1933 (the "1933
Act"), controls ("controlling person") the Investment Adviser,
against any and all losses, claims damages, liabilities or
litigation (including reasonable legal and other expenses), to
which the Investment Adviser, such affiliated person or such
controlling person may become subject under the 1933 Act, the
1940 Act, the Advisers Act, under any other statute, at common
law or otherwise, arising out of Subadviser's responsibilities
hereunder (1) to the extent of, and as a result of, the willful
misconduct, bad faith, or gross negligence by the Subadviser,
any of the Subadviser's employees or representatives or any
affiliate of or any person acting on behalf of the Subadviser,
or (2) as a result of Subadviser's material breach of this
Agreement, or its reckless disregard of its obligations
hereunder.
The Investment Adviser agrees to indemnify and hold
harmless the Subadviser, any affiliated person within the
meaning of Section 2(a)(3) of the 1940 Act ("affiliated person")
of the Subadviser and each person, if any, who, within the
meaning of Section 15 of the 1933 Act, controls ("controlling
person") the Subadviser, against any and all losses, claims,
damages, liabilities or litigation (including reasonable legal
and other expenses), to which the Subadviser, such affiliated
person, or such controlling person may become subject under the
1933 Act, the 1940 Act, the Advisers Act, under any other
statute, at common law or otherwise, arising out of the
Investment Adviser's responsibilities as investment adviser
(1) to the extent of and as a result of the willful misconduct,
bad faith, or gross negligence by the Investment Adviser, any of
the Investment Adviser's employees or representatives or any
affiliate of or any person acting on behalf of the Investment
Adviser, or (2) as a result of the Investment Adviser's material
breach of this Agreement, or its reckless disregard of its
obligations hereunder.
In no case shall the indemnity provided hereunder be deemed
to protect any person against any liability to which any such
person would otherwise be subject by reason of willful
misconduct, bad faith or gross negligence in the performance of
its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement.
13. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise,
the remainder of the Agreement shall not be affected thereby.
Except to the extent governed by federal law including the 1940
Act, this Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without
applying the principles of conflicts of law thereunder.
14. No provision of this Agreement may be changed,
discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the
change, discharge or termination is sought. No amendment of
this Agreement shall be effective with respect to the Trust
until approved as required by applicable law.
15. Any notice to be given hereunder may be given by
personal notification or by facsimile transmission, to the party
specified at the address stated below:
To the Investment Adviser at:
Aston Asset Management, LLC
000 X. XxXxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
Facsimile: (000) 000-0000
To the Subadviser at:
Lake Partners, Inc.
00 Xxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
Attn: President
Facsimile: (000) 000-0000
With a copy to::
K&L Gates LLP
State Street Financial Center
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
To a Fund or the Trust at:
Aston Funds
000 X. XxXxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: President
Facsimile: (000) 000-0000
or addressed as such party may from time to time designate by
notice to other parties in accordance herewith.
16. The Subadviser agrees that for any claim by it against
a Fund in connection with this Agreement or the services
rendered under this Agreement, it shall look only to assets of
that Fund for satisfaction and that it shall have no claim
against the assets of any other series of the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by their duly authorized officers as of
the day and year first above written.
ASTON ASSET MANAGEMENT, LLC
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive
Officer
LAKE PARTNERS, INC.
By: /s/Xxxxxxxxx X. Lake
/s/Xxxxxx X. Lake
Name: Xxxxxxxxx X. Lake;
Xxxxxx X. Lake
Title: Co-Chairman, Treas.;
President
SCHEDULE A
Fund Effective Date Initial Term
ASTON/Lake Partners LASSO Alternatives Fund
May 30, 2014 December 31, 2015
